ePartners Goes Vertical

In a move announced last week, the company's "solutions stack" effort will focus on converged software plus services for healthcare, government and manufacturing segments.

Smart VAR partners have long known that the key to higher margins is a solutions sale, one that combines typically lower-margin software sales with higher-margin customization and vertical expertise.

"We evaluated what we've done and intersected that with what we can sell and what customers want and put together a list of hot-shot solutions and that's what we'll market and sell," ePartners CEO Howard Diamond told CRN Monday.

"When you do repeatable stuff, the quality goes up and the cost goes down and we can market and sell to a focused group of customers," he added.

Microsoft executives including worldwide channel chief Allison Watson and Doug Burgum senior vice president of Microsoft Business Solutions Doug Burgum have long pushed the notion that healthier partner margins lie in value-add, repeatable software implementations---which go way beyond shrink-wrapped disks.

As an example, Diamond cited a large customer win where a solution built atop Great Plains ERP, Microsoft Retail Management Solutions (RMS) and significant .Net customization beat out a rival bid by Oracle pushing its J.D. Edwards lineup.

Diamond noted in that case, Oracle's software price undercut ePartners', but when implementation and services were factored in, the ePartners solution was less expensive.

"This is a big deal for us, $600,000 of which is software and $1.8 million is services. The solution provider has about 374 employees in 24 locations, Diamond said.

Seattle-based ePartners, like the army of other Microsoft channel players, is working to find ways to augment margins on software . Microsoft has held firm on margins per se, but has been trying to bleed out some costs of doing business for channel partners.